Proprietary companies, also known as private companies, are a common form of a business structure adopted by small and medium-sized entities (SMEs) in Australia. What is the meaning of “proprietary”? Blank 1 Question 7[select: , Ownership, Limited, Small, Private]

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The question asks: What is the meaning of “proprietary” in the context of proprietary (private) companies in Australia?

Option 1 – Ownership: This is not the meaning of proprietary in this context. Proprietary does not refer to ownership status or control in general terms; it signals a class of company ownership linked to private status rather than public trading.

Option 2 – Limited: While a proprietary company’s full legal name includes “Proprietary Limited” (Pty Ltd), the term “Limited” alone does not convey the full meaning of proprietary. “Limited” describes the liability structure (limited liability) but not the private nature of the ownership. The question focuses on what “proprietary” conveys about the company’s nature, which is more accurately captured by the private aspect rather than just the liability feature.

Option 3 – Small: This is incorrect. The term proprietary has nothing to do with company size (small, medium, large). A private company can be of any size, and the designation doesn’t specify scale.

Option 4 – Private: This is correct. In Australia, a proprietary company (often abbreviated Pty Ltd) is a private company. The word “proprietary” signals that the company is privately held and not publicly traded on a stock exchange. It typically indicates restrictions on share transfers and that the company is not a public entity, distinguishing it from public companies which raise capital from the public markets.

In summary, among the options provided, “Private” best captures the meaning of proprietary in the Australian SME context, whereas the other terms either misrepresent or do not address the private nature of these companies.

MCD2150 - T2 - 2025 Week 7 Workshop Quiz

Proprietary companies, also known as private companies, are a common form of a business structure adopted by small and medium-sized entities (SMEs) in Australia. What is the meaning of “proprietary”? Blank 1 Question 7[select: , Ownership, Limited, Small, Private]

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MCD2150 - T2 - 2025 Week 7 Workshop Quiz

Proprietary companies, also known as private companies, are a common form of a business structure adopted by small and medium-sized entities (SMEs) in Australia. What is the meaning of “proprietary”? Blank 1 Question 7[select: , Ownership, Limited, Small, Private]

View Explanation

Log in for full answers

Similar Questions

(3 marks, difficulty level: Very Easy) Organizing a firm as a corporation has certain disadvantages over a proprietorship or partnership, such as "_____________," but also conveys some advantages, such as "__________."

Which of the following is not characteristic of a company?

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More Practical Tools for Students Powered by AI Study Helper

Making Your Study Simpler

(3 marks, difficulty level: Very Easy) Organizing a firm as a corporation has certain disadvantages over a proprietorship or partnership, such as "___," but also conveys some advantages, such as "."